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The US Attorney’s Office in New York City reportedly has filed charges against seven vendors of Ahold-owned US Foodservice, alleging that the companies engaged in conspiracies to falsify books, records and accounts.

They are: Brian Crowley, president, Food Services Division at Ken's Foods Inc. in Wellesley, Mass.; Robert Henuset, director of sales, East Foodservice at Crowley Foods LLC in Yardley, Pa.; Ritchie Langfield, an independent food broker in Sisters, Ore.; Frank Lysiak, former director, National Distributor Sales at Rich Products Corp. in Buffalo, N.Y.; Ernie Rosenberg, key account manager at J.R. Simplot Co. in Exton, Pa.; Dale Schulz, an independent food broker in Wayzata, Minn.; and Larry Stone, an independent food broker in Baltimore, Md.

The seven reportedly already each have paid $25,000 fines to the US Securities and Exchange Commission (SEC) to settle fraud charges. If convicted of the new charges, the vendors each face up five years in prison and a maximum fine of $250,000.

Federal prosecutors so far have charged 16 US Foodservice vendors of engaging in activities designed to help the company artificially inflate its sales and profit numbers.

Michael Resnick, US Foodservice's former CFO, and Mark Kaiser, its former marketing chief, are facing charges of securities fraud, conspiracy and making a false filing with the SEC.
KC's View:
This is like the scandal that will not die.

Which, if you work for these vendors or US Foodservice, is a terrible thing.

If you’re in our business, however, it is like the gift that keeps on giving.

Because it highlights procedures that we all know take place at other companies, procedures that are focused on everything other than selling more good products to shoppers. It gives us something to talk about. (Though some people would argue that the word “pontificate” would be more accurate…)